Loss scenario testing

31 January 2016

We were appointed by a power-sector client to undertake a business impact review based upon a predetermined loss scenario. The client insured its revenue generating assets and wanted to understand what would be the business consequences arising from the loss of its head office facility.

We were appointed by a power-sector client to undertake a business impact review based upon a predetermined loss scenario. The client insured its revenue generating assets and wanted to understand what would be the business consequences arising from the loss of its head office facility.

Echelon worked together with the client's risk and insurance team to brief business unit managers on the project and to identify and evaluate the financial impacts associated with this particular loss scenario. A wide range of group functions were involved - such as IT, facilities management, HR and treasury - in evaluating time lines and costs associated with creating a replacement head office facility.

We reviewed the client's assessments and performed a gap analysis between the estimated business impacts and the policy cover currently in place. Our analysis highlighted significant cost exposures that were uninsured. The client used our report to consider whether to transfer these risks to insurers or to reduce their exposure by implementing other risk management techniques.